Anders la Cour, co-founder and Chief Executive Officer of Banking Circle discusses the findings of the bank’s latest market research, and how financial institutions can future-proof their businesses.
Financial institutions – like businesses in almost every other industry – have been planning and implementing increased digitalisation for some years. However, the COVID-19 crisis and resulting restrictions have accelerated the rate at which new tech and processes have been launched.
Just before COVID-19 closed the shutters on much of the global economy, Banking Circle commissioned detailed research amongst financial institutions across Europe to look at the influence COVID-19 was having on the delivery of financial services. We gained a unique snapshot of business planning and confidence at this critical and historic time in the life of so many providers, and are publishing the findings in a series of white papers Part One is available to download now.
When asked directly about the impact COVID-19 has had on business planning, our respondents were optimistic. The most common response, at 41%, was that the crisis has had ‘a little’ impact. A quarter (26%) expect the impact to be ‘significant and wide-ranging’.
The main challenges focusing the minds of those in financial services are aligned to a business-as-usual world. 58% of senior executives in financial institutions operating in key European markets said the impact of regulation was one of their top three challenges. 53% considered the implications of constantly evolving customer expectations as a top-three challenge. Regulation and changeable customer expectations are not new challenges and could have topped any similar poll in the past ten years or more.
Now financial institutions of all types must take time to understand the future, using the lessons of the past and the pandemic, to determine longer-term thinking around the infrastructure that enables success.
Collaboration is a key aspect of a future-proof business. Payments businesses should look at other organisations as potential partnership opportunities, whether current competitors, partners, customers or suppliers. The distinction between these categories is blurring, and businesses are all in this together.
Digitalisation is a journey, not a destination: market conditions, regulation and tech are constantly evolving. Keeping up to speed, let alone getting ahead of the game, involves continual development and affects every area of the business. Therefore, it is vital that everyone is on-board, and banks, payments businesses and FinTechs must understand the role of financial infrastructure alongside new applications, services and solutions, working together to optimise delivery of the right propositions to meet customer need.
Although 2020 hasn’t delivered the clear view we had hoped for, it has provided excellent learning opportunities and 20/20 hindsight will be invaluable to future-proof businesses. This will help financial institutions of all types to regain clarity and confidence and see 2020 as a time that really did lay the foundations for a bold new future.